11th April 1990

No. sov 1-58/81P-II.dated 11th April 1990. In exercise of the powers conferred on him under section 144 read with section 167 of the Punjab local Government Ordinance, 1979(VI of 1979), the Governor of the Punjab is pleased to make the following Rules: –

1. Short Title and commencement.

(1) These Rules may be called the Punjab local councils (lease) Rules, 1990.

(2) They shall come into force at once.

2. lease of collection Right.
A local council may lease out by public auction for a period not exceeding one year, the collection rights of tax, fee, rate, toll cess or other charges levied by a local council.

3. Eligibility.

(1) No person shall be entitled to participate in an auction who is a defaulter in respect of any dues of the local council concerned or has been black listed by the concerned local council or is a declared in solvent.

(2) If a person intends to participate in an auction on behalf of any other person he shall at any time before the auction produce a power-of-attorney to the Chairman local council or convener of the Auction sub-committee or its authorised representative.

4. Procedure of auction.

(1) For the conduct of an auction a public notice not less than one daily newspaper and at least seven days before the date fixed for auction shall be given by the local Council.
(2) The notice shall contain the date of the meeting of the Local Council to be held for considering the acceptance of bids made in an auction:
Provided further that the first auction for the relevant year shall be held at least two months before the start of the financial year and no subsequent attempts, if any, shall be made after fifteen days from the first attempt.

(3) No lease shall be granted through negotiation, persuasion or any method other than open auction unless two attempts of auction have been made.

(4) In the meeting of the house, the Local Council may either accept a bid or reject the same.

(5) Where the Local Council rejects a bid the lease shall again be put to auction and the provisions of these Rules shall apply to such re-Auction.

5. Acceptance of bid.
No offer, the amount of which is less than the average amount of the highest bids made during the three immediately preceding years shall be accepted unless two attempts have been made to auction the lease.

6. Earnest Money.

(1) Before the start of auction all bidders shall deposit earnest money which shall not be less that two per cent of the amount for which lease for the last preceding year had been made or in case the collection was made departmentally of the total income collected by the Local Council concerned and in case the auction is conducted period of the said last preceding year.

(2) The earnest money deposited shall be refunded forthwith to the person making it, if the Local Council does not accept the bid and where the bid is accepted the deposit shall be refunded to him after the expiry of the lease period, provided that he has paid full dues of the Local Council and has duly performed all his obligations under the lease.

7. payment of dues.

(1) The person whose bid is accepted by the Local Council shall deposit a sum equal to one tenth of the amount of his bid within three days of the acceptance of the bid.

(2) The decision of the house shall be communicated to the bidder on the same day in writing through special messenger and where this is not possible through registered post.

(3) The highest bidder shall also be informed about the date of the meeting of the Local Council fixed for considering the bid.

(4) The remaining 90% amount of the bid shall be paid by the lessee to the Local Council in equal monthly instalments before the start of the month for which the installment is due:
Provided that the number of instalments shall be so fixed that last installment is paid one month before the 1st day of the last month of the contract of lease.

(5) A lease shall not become operative unless the lessee enters into an agreement with the Local Council.

(6) The expenditure of such agreement shall be borne by the lessee.

8. Cancellation of lease.

(1) If the lessee fails to pay one tenth of the amount of his bid or any installment within the time specified in these Rules or commits any breach of the provisions of these Rules to any other action which it may be entitled to take against the lessee under the law or these rules may forefeet his earnest money and security deposit and forthwith cancel his lease.

(2) If the lessee is found over-charging any tax, rate, fee, toll cess or any other charge he shall be liable to refund the excess amount with an amount equal to three times the excess amount as penalty to the person from whom overcharging had been made.

(3) If, due to any miscalculation or error any amount has been charged in excess from any person such person may within two days of such payment, apply to the Taxation Officer of the Local Council for the refund of the amount charged in excess.

(4) Any application made under sub-rule (2) or (3) shall be investigated by the Taxation Officer and if on investigation the claim is found to be correct, the amount charged in excess shall be refunded and n the case of overcharging alongwith penalty under sub-rule (2) to the person concerned by the lessee under the orders of the Taxation officer.

(5) Notwithstanding anything to the contrary contained in the Punjab Local Council Appeal Rules, 1981, appeals against the orders issued under these Rules shall lie to the authorities as under:-

S. NO Authority Making the Order under appeal Appellate Authority.
Any order issued under these Rules by the Taxation Officer Chairman of the Local
2 Any orders issued under these Rules by the chairman, Union Council, Town Committee or Municipal Committee . Assistant Director, Local Government & Rural Development Concerned.
3 3. Any order issued under these Rules by the Mayor of Corporation, Chairman of Zila Council or Mayor of a Metropolitan Corporation. Director ,Local
Government & Rural
Development Concerned

(6) Order, passed in an appeal shall be final and binding and there shall be no second appeal under these rules.

(7) Any reference in these Rules to the Taxation Officer of a Local Council shall be deemed to be a reference to the Secretary or the Chief Officer of the said Local Council.

(8) The Local Council may from time to time review the working of the lessee and take such steps as may be necessary to ensure that the least inconvenience is caused to the public.

(9) If as a result of default on the part of the lessee the lease is cancelled, and the lease is put to re-auction or the Local Council resumes collection departmentally or the lessee fails to pay the lease money or any part of it in accordance with these rules an other terms and conditions of the lease, and there occurs any short –falls in the income of the Local Council as compared to the bid money the difference or the defaulted amount, as the case may be, shall be recoverable from the defaulting lessee as arrears of land revenue.

9. Maintenance of record.

(1) The lessee shall maintain an account of the receipts of the tax rate, toll, cess etc. in the forms prescribed by the Local Council and such accounts shall at reasonable times be open to inspection by the Chairman, Chief Officer, Taxation Officer or any Officer authorised by the Local Council in this behalf.

(2) At the end of the lease period the lessee shall hand over the complete record to the Local Council, which shall become the property of the Local Council.

(3) The prescribed forms being used for the collection for which the collection rights are leased out shall be supplied by the Local Council at the cost of the lessee and the cost of such forms shall be over and above the bid amount.

10. Performance of duties.

(1) The lessee and every person employed by the lessee as his agent or servant for collection under a lease shall exercise all powers and be subject to all responsibilities attaching to persons appointed for such collection under the Ordinance or any Rules thereunder;

Provided that the lessee shall not appoint his employees or agents without the prior approval of the Chairman of the Local Council.

(2) The staff employed by the Local Council for such collection shall work under the supervision of the lessee and disciplinary action against such staff shall be initiated on the recommendations of the lessee by the authorities specified under the Punjab Local Council Servants Efficiency and Discipline Rules, 1981, but their inter—transfer within a branch shall be under direct control of the Chief Officer and their transfer from one Branch to another shall be made by the Chairman.

(3) The salaries of the staff, allowance, re-imbursement of medical charge, premium of Group Insurance and other fringe benefits sanctioned by the Government or the Local Council for such employees from time to time shall be paid by the lessee over and above the lease money direct to the Local Council before the first of every month except of payment of June Which shall be made in advance before the 15th June every year.

(4) The rent of any building taken on rent by the Local Council, if any, for the purpose of collection posts or offices, shall be payable by the lessee.

(5) No transport facility shall be provided by the Local Council for collection purpose to the lessee.

11. Property. The lessee shall be responsible for the maintenance and upkeep of the building, furniture and fixtures belonging to the Local Council and used by the lessee at the collection posts or offices.

12. Rebate. The lessee shall not be entitled to any rebate on any ground whatsoever.

13. Expiry of lease. After the expiry of the period of the lease, the contractor shall hand over peaceful possession of the building, furniture and other property of the Local Council and also the collection rights to the Local Council or the person authorized by it and in case the lessee collects the tax, toll, fee, cess, etc. for any period beyond the stipulated period for any reason whatsoever he shall be liable to pay penal installment proportionate to the extra period which can be subject to the maximum of ten times of the normal installment in the discretion of the Local Council.

14. Repeal. Rule 225 of the West Pakistan Municipal Committees (Octroi) Rules, 1964, is hereby repealed.

15. Relaxation. Any of these Rules may for reasons to be recorded in writing be relaxed by the Government in an individual case, if Government is satisfied that strict application thereof would cause under hardship to the individual concerned.